Bank Charges - illegal?

dchurch24

M_Thomson wrote:

That's rubbish and you know it. I am not rich myself and I care very much about people who have less than me. At the same time I take responsibility for myself if I make a mistake, unlike you who gets litigious at every opputunity. Having that opinion does not make me a right winger.

Hey, I'm not trying to upset you, and I apologise if I have. That was not my intention.


Perhaps I should go to bed :-)

dchurch24

There have been other things that you have mentioned where you are aware that what you are doing will incur charges yet you feel you should not have to pay them.

I'm not sure what you are referring to here.

Again, having the 'nerve' to sue them when 'I am at fault' is irellevent. It does not matter how the charge came about - it's punitive and therefore not enforcable.
I have the nerve to sue them because what they are doing is not operating within the law.
Knowing the law when it directly affects you is not ignorance. Quite the opposite.

gothicf0rm

no, they werent consecutive days, hence the charges add up! it doesnt matter if they were consecutive or not, its just a way of putting into perspective the outrageous sums they can make from very small infringements. if they were consecutive theyd have only been able to charge me once a month for going over my limit. another example of how it doesnt reflect the loss.
i dont mind people being able to claim money for loss, infact i think thats a good, i do think it should reflect the loss. banks should make their charges proportional for this as they do for other services they offer, instead they have one charge fits all regardless of the loss. the entire system is plain dumb and works for no-one.

M_Thomson

gothicf0rm wrote:

no, they werent consecutive days, hence the charges add up! it doesnt matter if they were consecutive or not, its just a way of putting into perspective the outrageous sums they can make from very small infringements. if they were consecutive theyd have only been able to charge me once a month for going over my limit. another example of how it doesnt reflect the loss.

So do you not think after one or two charges you could have stopped and thought maybe it is me doing something wrong here??! Fair enough your if you were in genuine difficulty then yes the bank should help you but I cannot believe that you have been in difficulty over the last five years to incur £2000 worth of charges. Of course your bank will not increase your overdraft if you have had that many bank charges in the last few years.

gothicf0rm

the least i have been overdrawn by is 59 pence, for this i paid 58 pounds. i was 59 pence overdrawn because the credit card company neglected to mention they were charging me one pound extra because i was paying it over the phone. i then went over my limit for a few days next month because i'd been charged for this - the bank said theyd written but thats news to me as i didnt get a letter from them so the charges i was unaware of from the previous month sent me over the limit again. get the picture yet? thats 116 of my claim accounted for straight off.... wanna know why i made that payment on the visa? i looked at my account at the end of the month and had some money left over so i paid it in to the nearest pound left in the current account. i thought that was responsible behaviour.
shall i tell you about the time i made a cash deposit into an atm which told me AFTER the deposit had been made the cash would take days to clear and that i had to buy a railway ticket to get home. i guess youd be responsible and beg for the money or live on the street.
maybe youd like to hear the time the bank managed to cash a cheque for british pounds in canadian dollars, how about the two times they have managed to lose cheques altogether, including one incident that ten months to resolve. you know what, they refused to ever pay a penny compensation. infact they never even refunded me the interest they charged me on the fees i had suffered because of their mistakes nor did they refund me for the fees i been charged for paying my visa late because of their mistakes.
i guess you are able to monitor my balance perfectly unlike me or my bank who as i said managed to cancel my card one time saying i owed them money i didnt owe! all it takes is not having the necessary funds in your account for one minute of one day. you might realise "oh i dont have enough money in there" and pay more in, but thats too late by then.
i might have been doing something wrong, but they were doing something illegal.
why wouldnt my bank increase my overdraft, im not usually overdrawn! i had been reducing my overdraft, paying off my student loan and so on. i have no other debt apart from a credit card, my debt level on that is less than two months of my income, i own my own home outright at the age of 28 etc. when i am overdrawn its only ever been for a couple of days at the end of the month apart from when i switched my income source, basically i didnt draw an income for three months, i wont go into the precise where and why of it but it was caused by changing systems. i still earned money in that three months, it was however unable to reach my account and so i ended up in october getting 3 months money at once. now you tell me, why would i be such a risk they couldnt extend my overdraft for three months but would happily offer me a loan for four times as much???
the point is, most of it hasnt been difficulty. most of it has been my balance being a couple of pounds over the limit and thats all it takes, one single penny. sometimes its been through my miscounting and realising and making a transfer which has come through one day too late, but just as often through the mistakes of others.
i see your position is softening, the problem at heart is the fact that banks have very little human input into individual decisions any more. there is no common sense and that total lack of humanity in the decisions they make turns customers into people like me.
a great example is my girlfriend, lloyds tsb who she banked with wouldnt give her a debit card because she hadnt made a payment into the account every month. she wasnt in the country! she's a student and makes in payments of approx 30,000 a year, 10,000 per term from her father, which is more than most students but they still wont give her a debit card or cheque book. now any human being would see this would be a smart thing to do, to give her banking facilities for this money but they wouldnt. she went elsewhere. either way the result is they end up with customers annoyed enough to sue them.

Tim_L

M Thomson, I wouldn't have used the term right winger personally, but it is not an insult in the same sense as calling someone "bonkers" or "mad": this is to attempt to marginalize a reasonable position by an ad hominem attack. If you have a cogent argument then you don't need to resort to childish name calling. But as far as I can see the crux of your point is that having signed up to a terms and conditions you are bound by them by contractual law and some sense of "personal responsibility", and this is quite simply wrong.

The assertion that if these charges are removed then banks will start charging for current accounts (cheques, dds, and so on) is really irrelevant. If banks feel they can charge for current accounts then believe me they will start doing it, whether or not the income stream from late payment charges is removed. However I don't think this is remotely likely because the culture of this country is now used to "free" banking - recall the fuss a few years ago when general charges were mooted on ATM withdrawals. There is also clearly no net cost at all to the bank of operating a current account, since it is a service offered for profit (either by charging interest on accounts with an overdraft or by employing the capital from deposits to make further money): all that is at issue is the amount of profit that can be squeezed from any particular customer.

In any case, late payment charges cannot subsidise free banking, because if they are used in this way they are not covering costs incurred, and hence explicitly illegal. No-one is arguing that costs should not be charged, but as has been said many times, these are punitive charges, not costs.

Illegal terms and conditions in contracts are, well, illegal. You have not addressed this point at all. If the t&c of an offer state that someone will come round to cut my legs off if I don't adhere to the t&c of the offer, then I can safely sign that contract knowing that this clause is is completely unenforceable legally. If someone tries to enforce an illegal clause then I can take them to court to stop the action, and sue them for the costs (and restitution of loss). There is no "personal responsibility" to make a payment stemming from an illegal demand. If you disagree then I would point out that one of the conditions for reading this posting is that you undertake to pay me £1M by next Tuesday, failure to comply will of course result in my instigation of debt recovery procedures. Acceptance of these terms and conditions will be demonstrated by your having downloaded the text to your browser.

Of course since it would be impossible to open a current account in this country without agreeing to late payment clause the only option is to sign now and argue about it later: because we have moved to a society where a bank account is essentially mandatory, banks operating as effective cartels have a great deal of power to impose standard t&c, including illegal clauses. It is in everyone's interests, a "collective responsibility" perhaps, to stop them doing this by personal action and by supporting regulatory action.

I repeat: these charges are reprehensible because they affect disproportionately those on the margins of difficulty and those who don't manage their financial affairs well. They happen to be illegal too. As someone who is actually wealthy - and who has made the odd late payment by accident - I refuse to see this practice as in any way fair and will not accept it when imposed on others. It is also bad business, because many of those affected will be students with some reasonable expectation of wealth later in their lives.

dchurch24

My mother had a similar time with Lloyds - her wages were paid into an account of a person with exactly the same name, her DD's bounced as a result and she was charged. They flatly refused to pay back the charges taken even though it was obviously not her fault. You'd think that someone would have come up with the idea of a unique account number by now wouldn't you.
She overdrew by the amount of the charges and never paid another penny into that account.
At one point some years ago, I had 2 personal loans with Barclays (both were small amounts) - I went into a branch to enquire about joining to 2 together to make one payment - after looking at the figures I decided that it was in my best interest to keep both rather than take on just the one. I phoned the bank and told them that I didn't want the loan (bear in mind, I hadn't actually even filled out an application for it), and was told not to return the paperwork and if I did this then nothing would happen and all would continue as before. In fact I took the uncompleted application form back to the branch where their 'personal banker' threw it in the bin.
Now, at that time I was 21 and living at home and I earned quite a considerable wage and didn't notice that the 2 loan payments weren't coming out of my account anymore. I earned enough that each month there was a considerable amount left over before receiving more pay (I had no bills of my own to pay, just one payment to my parents), so didn't worry that much about budgetting.
After 4 months, I received 2 letters demanding the money for each loan back immediately or they would take legal action against me (who created our litigious society?). I was charged 4 missed payment charges for each loan as they had cancelled the 2 standing orders on my current account to pay for each respective loan.
Now, sure, you could say I should have noticed that the money was not coming out of my account anymore, but why should I have? I was informed that there would be no change in our previous agreements. It was they that had stopped taking the money (by cancelling SO's on my account without my agreement), not me that had stopped paying, yet I was charged for their mistake.
I then changed banks to Abbey - I used what they used to call the 'Switcher Account'. The idea being that they switch all your DD's, SO's for you to your new Abbey account.
They did move some but not all, so I was charged late payment fees on my Smile credit card - Abbey flatly refused to admit it was their mistake, even though that particular DD was on the list they gave me of DD's etc... to be moved, and Smile refused to give the charges back.
Also, they stated in their paperwork that they also inform your employer of the change of account (apparently, 'life's complicated enough' so they do this all for you - ha ha).
They didn't, so the DD's that they had set up in the first instance all bounced - guess what?
You guessed it - I got charged for each one not being paid.
Of course at this time my Barclays account was closed - yet my wages had been paid into it somehow - this took about 3 weeks to track down as Abbey said it wasn't their problem and barclays said the same. All the time my wages were floating around their systems making money for someone (not me) and I was struggling to get petrol to work.
Sadly, this was over 6 years ago, or yes, I would sue for recovery of ALL charges.

Gers

Whilst my experience of banks is nowhere near as horrendous as others on here my own tiny encounter was enough to really annoy me.

Recently £1,000 was transferred into my current account from a relative - cash paid over the counter at the bank in Scotland straight into my account. I use internet banking so could see the money in my account very quickly. I immediately moved the money from the current account into a savings account with the same bank.

At the end of the month I noticed a small charge on my current account for overdraft fees. I haven't used my overdraft for approx 4 years and check my account daily so I was very surprised - I scrolled through as far back as the site would let me... no overdraft use.

Then I phoned the bank and the very kind operative started to tell me that I was overdrawn on..... nope, never overdrawn!! :j The explanation given to me was that I had moved the cash too soon, drawn on my current account and incurred charges. At no point was my account overdrawn, with or without the £1,000 and moving the £1,000 did not give me a debit balance.

Luckily I was on the ball and got the very small charge refunded 'it will take 3 days to clear Madam'. :rolleyes:



My only other encounter was back in the bad old days of being in my second job (1842) and the bank manager wrote to me on 28th of a month to say 'Dear Madam, just to advise you that your account is overdrawn by £5.00'. I responded with 'Dear Sir, so what?'. He didn't write back!!


Good luck to all those who are fighting punitive charges. I wish I'd known about this a long time ago.

inmypocketnottheirs

M_Thomson wrote:

I am sure there are some banks in France that do not make charges but the norm in Europe (including France) and the US is that Banks do charge for most services that we in the UK get for free such as writing a cheque etc. This is what will happen here if you carry on doing what you are doing and it will effect people who are poor yet run their accounts properly. Would you be happy with that???!!

When I started work in 1979 I opened an account with National Westminster Bank. At the time, all banks operated a cartel (as indeed they do today), there was no free banking, charges were made for each debit and credit (about 20p each if I remember) direct debits and standing orders were free if I remember rightly, and a quarterly charge applied for running the account. In those halycon days, if you exceeded your limit, or went overdrawn there used to be some human intervention, and more often than not the cheque would be paid if the bank could see you were due to be paid. Sometimes you would even get a call from the bank asking if you were able to pay in to cover the item going out. Incidentally returned cheques were £5, and if the charge was greater than the cheque, the cheque would get paid. Everybody paid for their banking, and paid proportionately to the amount the account was used. Now that seems like a fair system to me.

Personally, I would welcome a return to that level of service and charging, but due to the corporate greed of this nation, service levels have declined based on cost cutting measures, and the cost of retail banking now has to be shouldered by the financially marginalised. Now that seems like an unfair system to me.

Tim_L

It's not so much corporate greed as the requirement of PLCs to provide growth for their shareholders. There are people in banks looking at every aspect of their products and services to squeeze extra cash from them to boost the bottom line. This is really the way commerce works - in fact if we are honest we are doing the same sorts of things by "moneysaving" - and I don't really have a problem with it in general.

However when this leads to illegal punitive charges then it is perfectly right to challenge them, especially when these charges are concentrated on those least able to pay them.

I thought of a good analogy this morning. Say you take your car into a garage and get an estimate for work, including parts and labour, which you agree to. After paying the bill, you discover that the parts were overcharged and that the labour was overstated. You have agreed to the terms and conditions, but you would certainly not be happy - if this was a significant overcharge most would consider taking legal action against the garage. And yet this is precisely the situation with late payment or overdraft charges: people are being asked to pay costs not incurred.

Perhaps there is something about the mock formality most banks use in their agreement wording that persuades people that they are dealing in a serious way with a serious institution, but in fact the banks are operating at the level of cowboy tradespeople by insisting on these charges. And they can be challenged on this basis.